livingcheaply

It’s that time of year again when everyone makes those well-intentioned promises, spurred on by the beginning of a new year.

In this economic climate, many people will be vowing to spend less and save more. Over the next couple of weeks, we’ll take a look at ways to do just that. But before I dive into that, let’s get a few things in order.

Is being frugal really being cheap? I know the blog’s title is “Living Cheaply,” but being frugal isn’t about being a tightwad. It’s about getting the best value for your money. It’s about living within (read that as below) your means. It’s about investing for your future.

We frequently spend money on items that you wouldn’t consider basic necessities, but we do it when we can afford it and when we get good value for our hard earned money.

Do you need a budget to live frugally? Absolutely. You wouldn’t build a house without a plan would you? You can’t master your finances and control your spending without having a road map to follow. Actually my next few posts will deal with setting up a budget. It isn’t hard to do, you just have to be disciplined about it. Budgets don’t have to be fancy or complicated, but they have to be followed.

Is paying cash necessary? You bet. Buying on credit incurs all kinds of nasty expenses. First there are interest charges. And mess up and pay even a few minutes late or exceed your limit buy a few cents and you are subject to hefty fees. Plus, people who buy on credit tend to spend more, as much as 17%*- 30%** more than if they were paying with cash.

(* According to a national grocer’s association)

(** According to every other survey I have seen)

Stay tuned for the next posts in the series.

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